PETER Mandelson has finally owned up to the fact that not only will the number of universities have to be limited but so too the places available.

Mandelson has owned up to the fact that the number of university places available will be limited []

The simple reason: Britain’s tertiary education system has run out of cash. So now Lord Mandelson is telling the truth about the pot of money, perhaps he should tell the truth about where it should be spent and drop Labour’s absurd targets which have long pledged that 50 per cent of all youngsters would go to university.

Last week a think-tank called for university fees to be raised to maintain quality of courses. Policy Exchange also recommended students from the wealthiest households be removed from the students loans scheme and offered loans from a regulated private scheme at a lower than commercial rate of interest.

While this suggestion might not be to the taste of some it is important to emphasise that the Government’s student loan debt is set to be £55billion by 2018, an unsustainable burden. Anna Fazackerley, the author of the Policy Exchange report More Fees Please?, says that she was stating financial facts and did not mean to scare the hard-pressed middle class.

How ever she stressed universities saw Government funding slashed last week with rumours of more reductions.

Privately vice-chancellors are looking at culling entire departments along with admitting more foreign students whO pay higher fees, which would bring about alarming changes in higher education and threaten departments such as modern languages which do not bring in much research revenue.

Fazackerley says that if Britain is to retain its position as a global leader in higher education, fees will need to rise but only if such rises go hand in hand with increased investment in teaching. Vice-chancellors have long said funding does not give them enough to meet government targets for student numbers and provide quality teaching.

The argument that the best universities should be all owed to charge more is an increasingly accepted view. With money fast running out surely you have to decide which establishments deliver quality from those which do not and that will inevitably mean closures.

The blame for this fiasco lies at the feet of Tony Blair whose idea it was that 50 per cent of all school-leavers would go to university, a move that has led to one of the highest university drop-out rates in the world, with many institutions reporting that nearly a quarter of their fi st-year intake quit after less than a year.

So why should taxpayers’ money go to high drop-out courses? Blair’s mistake was going for numbers rather than looking at what sort of courses would be of benefit to our economy. A decade ago Korea sent 60 per cent of youngsters on to tertiary education, studying engineering-based subjects perfect for industrial careers. Switzerland had a tiny number going to university but a very robust provision outside traditional seats of learning.

In Britain traditional practical learning was being picked to pieces as countless polytechnics gained university status offering “degrees” in such subjects as soap operas. Most students came from poorer backgrounds so were left with a gargantuan debt. These students that Blair pledged to help now make up the largest part of Britain’s drop-outs.

The University of Bolton sees just 50 per cent of its initial intake walking out with any degree. In contrast Imperial College, London sees 90 per cent of students gaining a respectable degree.

While no one is suggesting a return to the elitist old days, before 1997 about 10 per cent of school-leavers went to university and were almost guaranteed a good job at the end. Now many who graduate from polytechnics-turned-universities leave with vast debt and a lack of interest from employers who pick people from traditional universities.

The stark truth is: fewer school-leavers should go to university. Tuition fees will have to rise to at least £5,000 a year for all undergraduates. Only then can universities afford to offer a range of courses with the best teachers. You might not want to hear this but it is the harsh reality in which we find ourselves today.